Mumbai: Shares of IDFC First Bank traded in the green on February 24, a day after hitting a 20 percent lower circuit, as the Haryana government confirmed recovery of most of the funds linked to a Rs 590-crore fraud.
At around 2:30 pm, the bank’s stock was up nearly 1 percent at Rs 70.54 per share.
Rs 556 Crore Recovered Quickly
Haryana Chief Minister Nayab Singh Saini informed the State Assembly that nearly Rs 556 crore, including about Rs 22 crore as interest, had been recovered within 24 hours.
He clarified that the entire amount related to Haryana government departments had been credited back to official accounts. “The recovery has been made within 24 hours,” he told the House.
Details of the Fraud
On Sunday, the bank disclosed a Rs 590-crore fraud involving accounts of the Haryana government. According to the Chief Minister, the issue was mainly linked to a specific branch of the bank in Chandigarh.
He said four to five employees from middle and lower levels allegedly colluded with external parties in the fraud.
The bank’s Managing Director and CEO, V Vaidyanathan, also stated that the fraud was the result of collusion between certain employees and outside individuals. He added that the bank would make some financial provisions to account for the loss.
Probe Ordered, Action Promised
Saini said the state’s Anti-Corruption Bureau would carry out a detailed investigation. A committee headed by the Finance Secretary has also been formed to examine the matter.
He assured the Assembly that strict action would be taken against anyone found guilty - whether a bank employee, private individual or government official.
The issue was raised by the opposition Congress in the Assembly. Responding to criticism, Saini said his government follows a zero-tolerance policy against corruption and ensures accountability.
The quick recovery of funds appears to have helped calm investor concerns, leading to a slight rebound in the bank’s share price after the sharp fall earlier.
